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October 2, 2003

Report: New York has one of nation's most 'anti-entrepreneurial' business environments

New York State is one of the most anti-entrepreneurial environments in the nation, according to a new report by the Small Business Survival Committee (SBSC).

New York ranked 45 on the list of 51 business environments in the study. Only California, Rhode Island, Maine, Minnesota, Hawaii, and the District of Columbia ranked lower.

For its eighth annual index, the SBSC tied together 21 government-imposed policies that affect small business, including personal, corporate and real estate taxes, workers' compensation costs, and state legal liability costs.

The SBSC, an organization that lobbies lawmakers for pro-business policies and legislation, pointed to New York's anti-growth policies as a reason for its low index rating.

In 2003, New York increased the personal income, capital gains, and sales tax rates.

"The best policy environment for entrepreneurship and small business consists of low taxes, limited government, restrained regulation, and government protecting life, limb and property," the report concluded.

"States following such a government philosophy will reap great rewards from America's entrepreneurs."

The Business Council and its research affiliate, The Public Policy Institute, have long argued that New York undermines its competitiveness by imposing one of the highest overall tax burdens in the nation.

"Our local taxes averaged $2,378 for every resident in 2000, more than twice
the national average," a January, 2003 report by The Institute said.

And, in a March 2003 report, The Institute showed that businesses pay more than a third of all tax revenues collected by the state and local governments in New York.

That report, A Fair Share--At Least!, found that businesses pay about one of four dollars collected by the state government, and more than 41 percent of property taxes raised by municipalities and schools.